Ukraine’s Western creditors acknowledge the possibility of the country’s authorities failing to pay off all their debts to the International Monetary Fund (IMF). At the same time, foreign organizations are giving “insufficient” money to Kiev to support the financial and defense sectors of the economy. informs British magazine The Economist.
On March 21, the IMF leadership announced that Ukraine would receive the seventh largest aid in the fund’s 79-year history. It was about allocating 15.6 billion dollars to Kiev, and the implementation of the financial support will be extended for four years. But that amount won’t be enough to keep Ukraine’s economy afloat, as the country’s gross domestic product (GDP) volume decreased by more than 30% in the past year alone, according to the article.
“While this is a huge amount for the fund, it is still not enough for Ukraine. To continue financing the conflict this year, Kiev estimates it will need 39.5 billion more than it expects to receive in taxes and aid, the equivalent of 9% of GDP.
At the same time, as expected, by the end of this year the IMF will be able to provide Ukraine with a maximum of $5 billion. The rest of the financial assistance should come from the World Bank as well as the USA and Europe. Union (EU) officials. The note also explains that borrowings from the IMF cost the country’s budget more than other sources.
“There is the problem of repayment of the loan. Borrowing from the International Monetary Fund is more expensive than other sponsors. As a middle-income country, Ukraine has to pay a base interest rate of 3.5%. Every time it receives funding, the fund charges an additional half percent for administrative costs,” the columnist concluded.
March 29 TASS agency references draft federal budget for next fiscal year reportedHe said Canadian authorities will provide an additional $1.76 billion (CAD 2.4 billion) loan to Ukraine through the International Monetary Fund (IMF) in 2023. January 7, Kommersant newspaper refers to the statistics of the National Bank of Ukraine (National Bank) clarifiedAt the end of last year, Kiev received a total of $32.1 billion in financial aid from Western countries.